Farmer groups call for the repeal of the rice tariffication act
With the next havest season just around the corner and the farmgate prices of palay continues to plummet, farmers’ groups and food security advocates called for immediate repeal of the Rice Tariffication Act to protect the livelihoods of 2.4 million rice farmers in the country
With reports that palay prices have already gone down to as low as P8/kg in some parts of Central Luzon, several advocates seek to revoke the Rice Tarrification Act as soon as possible. Led by Ka Trinidad Domingo, chairperson of Katipunan ng mga Bagong Pilipina (KBP) and co-convenor of the National Movement for Food Sovereignty (NMFS) from Nueva Ecija the group expressed the fears of small rice farmers in the country that the law will lead to early bankruptcy of rice farmers and the demise of the rice industry. Based on reports by NMFS members in Nueva Ecija, a growing number of rice farmers are already selling their ricelands.
Ka Trining avers that the massive entry of rice imports in the country five months after the enactment of the law has already driven current prices of palay below the cost of production, which is currently at P12/kg.
“You don’t expect rice farmers and their families to survive at the current farmgate price of P8- P12/kg, which is already reduced by more than half from its price of P20 – P24/kg in August of last year?” Ka Trining said.
The Rice Tariffication Act or Republic Act 11203 lifted the quantitative restrictions on rice imports and imposed 35 percent tariff on rice coming from ASEAN countries and 50 percent for those from outside ASEAN. According to Sen. Villar, the principal author of the Rice Tarriffication Act, the law serves as the final compliance of the Philippines to its commitments to the World Trade Organization (WTO).
However, the NMFS claims that the Philippine government could have stood firmly to exempt rice from all-out trade liberalization as it remains a key food security crop and crucial to the livelihoods of 2.4 million farmers. Ka Manuel Rosario, Chairperson of PKSK and co-convenor of NMFS added that the law does not seek to secure the country’s food security but promotes and protects the interests of big exporters and traders in the country as well as the agenda of economic managers to “stabilize” inflation to ease off worries of bankers and lenders.
While the Rice Tariffication Acts boast of assistance to rice farmers that are affected by the liberalization of rice trade, the so-called 10-billion peso Rice Competitiveness Enhancement Fund (RCEF) will be funded out of the tariffs to be collected from the rice imports. But NMFS argues that the P10 billion fund is not even sufficient to pay for the losses that will be incurred by farmers. A farmer that usually harvests 3.5 tons at P20/kg with gross sales of P70,000 in 2018 will have only a gross sales of P42,000/cropping at P12/kg. Cost of production in 2019 is around P40,000 – P50,000/hectare according to PSA. Hence losses for this cropping alone for the 2.4 million farmers would reach to as high as P67 billion.
Moreover, NMFS argues that the law also stripped the National Food Authority (NFA) of its regulatory functions such as quedan franchising, inspection and anti-hoarding powers, registration and licensing importers and operators in the grain business, collection of related fees and charges, control over exports and food security regulation. The NFA’s core function of stabilizing prices for rice and palay to ensure food security and fair price for farmers is removed and now reduced to mere buffer stocking. This situation gives rice hoarders and traders the perfect setup where they can be able to hold their stocks to control rice supply and prices.
The law removed the remaining albeit limited support that Filipino rice farmers have in the form of QR. The tariffication act pushed for the all-out liberalization, deregulation, and privatization of rice importation in the country, affecting millions of rice farmers, rice millers, and everyone in the value chain.
NMFS warns that if no drastic measure is done immediately to save rice farmers from bankruptcy, the country will witness massive conversion of ricefarms, which can seriously endanger the country’s long-term food security. NMFS thus calls for the repeal of the Rice Tariffication Act and immediate delivery of cash assistance to rice farmers affected by the law.